Observations and provocations from The Times' Opinion staff

Reading Supreme Court tea leaves on 'Obamacare'

March 27, 2012 | 5:47
pm

It's a well-established practice among reporters covering the Supreme Court to look for clues to the outcome in the justices' questions, even though it can be a fool's errand. So it wasn't surprising to see numerous articles Tuesday declaring the healthcare reform law's individual mandate to be in trouble, or even deep trouble, based on the inquiries from four GOP appointees on the court.

As the New York Times' Adam Liptak noted, "The conventional view is that the administration will need one of those four votes to win the case, and it was not clear on Tuesday that it had captured one."

The first part of that observation is indisputable. Justice Clarence Thomas has already expressed his desire to roll back the latitude the courts have given Congress under the commerce clause, so he seems an automatic vote to strike down the individual mandate. That means the administration, which is defending the mandate, will need to win the support of one of the other four Republican appointees: Chief Justice John G. Roberts Jr. and Justices Antonin Scalia, Anthony M. Kennedy and Samuel A. Alito Jr.

What's arguable is the conventional wisdom that sharp and sometimes stinging questions from the court necessarily portend opposition to a particular argument. In Tuesday's session, Roberts, Scalia, Kennedy and Alito teed up all the right questions about the mandate: What exactly is Congress regulating? Is its use of regulatory power proper? Where does that power end? What we won't know until the court issues its decision is how persuasive the answers to those questions were.

The man fielding the brunt of those inquiries was Solicitor General Donald Verrilli. He resolutely argued that the Patient Protection and Affordable Care Act regulated healthcare -- a huge market with enormous impact on interstate commerce that virtually everyone participates in -- and not merely health insurance. The mandate, Verrilli argued, was a proper means to regulate how people paid for the healthcare bills they couldn't predict but were almost certain to face. The mandate also helps ensure that the new insurance rules in the law, such as the requirement that insurers offer policies to people regardless of preexisting conditions, aren't gamed by people who sign up for coverage only after they become ill.

It may be a new exercise of Congress' power, Verrilli argued, but it doesn't stretch the limits of that power to the breaking point. Lawmakers' ability to regulate under the commerce clause, Verrilli argued, extends only to "economic activity with a substantial effect on interstate commerce."

The four justices responded with more skeptical questioning. Kennedy, for example, kept asking whether the mandate forced people to do something they had chosen not to do. Roberts asked whether the "essential benefits" provisions of the law, which requires insurance policies to cover an array of medical problems, required people to participate in markets for services they'd never need, such as maternity care and substance-abuse treatment. The chief justice also asked that if Congress could regulate the method of paying for healthcare, what about healthcare couldn't it regulate?

One could easily infer from these questions that these justices weren't buying the government's characterization of the mandate. But it may be more accurate to conclude that the justices were grappling with the implications of a ruling to uphold the law's constitutionality. If they gave the mandate the green light, how could they avoid eliminating all limits on Congress' power?

Having said that, I'm betting that Scalia will be joining Thomas in the "no" column on this one. Although he's well known for giving head fakes on the bench, Scalia flatly declared his disagreement with Verrilli on the central issue of whether Congress was forcing Americans to participate in a market they didn't want to be in. Here's their exchange:

Scalia: I don't agree with you that the relevant market here is healthcare. You're not regulating healthcare. You're regulating insurance. It's the insurance market that you're addressing, and you're saying that some people who are not in it must be in it and that's -- that's differen[t] from regulating in any manner commerce that already exists out there.

Verrilli: Well, to the extent that we are looking at the comprehensive scheme, Justice Scalia, it is regulating commerce that already exists out there. And the means in which that regulation is made effective here, the minimum coverage provision, is a regulation of the way in which people participate, the method of their payment in the healthcare market. That is what it is.

The lawyer for the states opposing the mandate, former Solicitor General Paul Clement, built his presentation around Scalia's point: The market being regulated was health insurance, and Congress didn't have the power to force people to participate in it. And Michael A. Carvin, the attorney representing the National Federation of Independent Business, argued that Congress doesn't have the power to force young, healthy people to carry insurance just to make premiums affordable for older, less healthy policyholders. He suggested that a better approach would be to require people who don't have insurance to obtain it when they need care.

The problem with Carvin's idea is that it would make people even more reluctant to carry insurance when they don't need treatment, shrinking the pool of policyholders whose premiums have to cover the cost of care. Premiums shoot up, fewer people can afford insurance, hospitals and doctors have to shift more costs onto the patients who do have insurance, and premiums spiral out of control.

Having pushed Verrilli on the issue of whether the mandate compelled people to buy something they wouldn't otherwise buy, Kennedy also voiced skepticism about Carvin's core argument. Said Kennedy: "I think it is true that if most questions in life are matters of degree, in the insurance and healthcare world, both markets -- stipulate two markets -- the young person who is uninsured is uniquely proximately very close to affecting the rates of insurance and the costs of providing medical care in a way that is not true in other industries. That's my concern in the case."

Arguments resume Wednesday on the questions of whether the court must throw out the rest of the Affordable Care Act if it finds the individual mandate to be unconstitutional, and whether the law's expansion of the Medicaid program, a joint effort by the federal and state governments, improperly coerces states to spend more money.